2371 - 2375 W Holly St

Fayetteville, AR 72703

$259,000D

4 bd · 2.0 ba · 1,776 sqft · Built 1967 · Townhouse · Pending · 114 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,062/mo
• Mortgage (P&I): −$1,358
• Tax + insurance: −$355
• HOA: −$0
• Vac / Maint / Mgmt: −$433
• Net cashflow: $-84/mo
• Annual: $-1,011/yr
• Cap rate: 5.90%
• Cash-on-cash: -1.39%
• DSCR: 0.94
• 1% rule: 0.80%
• Cash to close: $72,520

Investor read

• This is a 4-bed/2.0-bath townhouse listed at $259k.
• At list price, monthly cash flow is $-84 ($-1k/yr) — negative.
• To cash-flow at today's rent, offer at most $244k (5.7% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $206k (20.4% below list).
• It's been on market 114 days — a 9% lower offer ($236k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $206k (20.4% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $8k of value loss. Plan a longer hold.
• Location reads 83/100 on livability (#3 in AR, #871 nationally) — a professional / high-income tenant draw. Strengths: amenities A+, commute A+, health & safety A+; Watch: employment D+, crime D-.
• Fayetteville School District (urban): math 50% / reading 49% proficiency, ranked #19 of 238 in AR (top 8%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Asbell Elementary School (math 37% / reading 22%, grade F, #305 of 454 statewide, top 71%, 369 students, 82% FRL); Woodland Junior High School (math 63% / reading 64%, grade B+, #5 of 201 statewide, top 3%, 752 students, 26% FRL); Fayetteville High School East (math 41% / reading 50%, grade D-, #24 of 292 statewide, top 9%, 2,685 students, 27% FRL).
• Market conditions: Rents rising (+2.0%/yr); 316 active listings in the ZIP; 40 comparable units currently listed for rent nearby; rentals lingering (median 46d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 50% of comp listings sitting > 30 days — soft ceiling on asking rent; 3,494 units permitted in Washington County in 2024 (1,497 in 5+ unit buildings).
• Washington County population projected at +47% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 4 sale attempts since 4y ago; this cycle's ask has dropped $71k (22%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $225k; 15% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Climate carrying-cost: extreme-heat days projected 7→20/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.9% vs local median 3.5% in Fayetteville — top-decile yield for the area; either an underpriced asset or a hidden risk that comps aren't pricing in. Stress-test before assuming the spread holds.
• This rent runs 41% of the median local income ($61k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• What do current leases actually rent for vs. the listed asking? Can we see a recent rent roll and the last 12 months of T-12 income?
• It's been on market 114 days. Have you received any prior offers? Is the seller open to a 20% concession, seller financing, or rate buy-down credit?
• Built in 1967 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• Why hasn't it sold? Are there any deal-killer items the seller is aware of (foundation, flood, title, zoning, code violations)?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are B-rated — typically a magnet for longer-tenancy family renters. What's the average tenant stay here, and is there a school-zone premium baked into asking?
• Crime grade is D in this area — have there been break-ins, vandalism, or insurance claims at this property in the last 3 years? What carrier currently insures it and at what premium?
• The area grade is low — what's the realistic commute time and amenity access for the typical tenant pool here? Any planned neighborhood developments (good or bad) we should know about?